Down Payment Requirements

In British Columbia, the federally regulated minimum down payment is 5% of the purchase price on the first $500,000 and 10% on the portion between $500,000 and $1,499,999. For homes priced at $1,500,000 or more, a minimum down payment of 20% is required. These rules apply to insured mortgage financing and are set at the federal level, applying uniformly across all Canadian provinces including BC.

Mortgage default insurance — commonly associated with CMHC — is required in BC whenever a buyer's down payment is less than 20% of the purchase price. This insurance protects the lender, not the borrower, in the event of mortgage default. Properties priced at $1,500,000 or more are ineligible for insured financing, meaning buyers must provide a full 20% down payment for those purchases.

Yes, gifted funds are an acceptable source for a down payment in BC, but lenders typically require a signed gift letter confirming the money is a true gift and not a loan that must be repaid. The letter generally identifies the donor, the recipient, the amount, and the relationship between the parties. BC real estate licensees, governed under the Real Estate Services Act (RESA) and regulated by the British Columbia Financial Services Authority (BCFSA), must not misrepresent the source of funds in any transaction.

The BC Property Transfer Tax (PTT), governed by the Property Transfer Tax Act, is a separate cost from the down payment and must be paid by the buyer on completion of the transfer. PTT is calculated at 1% on the first $200,000, 2% on the portion from $200,000 to $2,000,000, 3% on the portion above $2,000,000, and an additional 2% on residential property value exceeding $3,000,000. Buyers should budget for PTT in addition to their down payment, as it is generally due on the completion date and is not financeable into an insured mortgage.

The First-Time Home Buyers' Program under the Property Transfer Tax Act provides an exemption from PTT rather than a reduction to the minimum down payment itself. As of 2026, eligible first-time buyers may receive a full PTT exemption on qualifying homes priced up to $835,000. Saving on PTT can free up funds that buyers may direct toward their down payment, but the federal minimum down payment thresholds still apply regardless of PTT exemption eligibility.

The federal minimum down payment thresholds — 5% on the first $500,000, 10% on the next portion up to $1,499,999, and 20% at $1,500,000 or more — apply equally to strata lots governed by the Strata Property Act (SBC 1998, c. 43) and freehold properties. There is no separate provincial down payment rule specific to strata lots in BC. Buyers of strata properties should also budget for strata fees and review Form B disclosure documents, but these do not alter the minimum down payment calculation.

Yes, under the Real Estate Services Act (RESA) and the Real Estate Services Rules administered by the BCFSA, brokerage trust accounts must be used to hold deposit monies — which may form part of a buyer's down payment — received before completion. Licensees are strictly prohibited from mishandling trust funds, and any deposit must be placed into a designated trust account promptly. The balance of the down payment beyond the initial deposit is typically advanced by the buyer's lawyer or notary on or before the completion date.

The federal minimum down payment thresholds apply to ALR properties in BC in the same way as any other real estate purchase, based solely on purchase price. However, ALR properties are subject to restrictions under the Agricultural Land Commission Act (SBC 2002, c. 36), which may affect the property's use, financing eligibility, and appraised value — factors that lenders consider when determining loan-to-value ratios. Buyers should consult the Agricultural Land Commission directly for guidance on permitted uses that may influence a lender's willingness to offer insured financing on ALR land.

BC real estate licensees regulated by the BCFSA under RESA have professional obligations to avoid facilitating misrepresentation or fraud in a transaction, which extends to being alert to unusual circumstances around the source of funds. Additionally, BC's Personal Information Protection Act (PIPA) governs how licensees collect, use, and disclose personal financial information provided by buyers when documenting down payment sources. Licensees are not mortgage underwriters, but they must not knowingly assist in misrepresenting the nature or source of a down payment to a lender.

When a beneficiary receives property through an estate governed by the Wills, Estates and Succession Act (WESA) of BC and later sells that property to purchase a new home, the standard federal minimum down payment requirements apply to the new purchase based on the new purchase price. Proceeds from the sale of an inherited property can serve as down payment funds, and lenders will require documentation tracing the source of those funds back to the estate proceeds. The down payment thresholds themselves are not altered by the fact that the funds originated from an inheritance.